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Jeffrey Gogo

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Bloomberg analyst Mike McGlone has predicted that the price of bitcoin will hit $100,000 by 2025. McGlone premised his argument on past bitcoin trends, including the period in which the price took four years to go from $1,000 to $10,000 in 2017.

“So, doubling that time frame for maturation could get the price toward $100,000 in about five more years,” he said, in Bloomberg’s Crypto Outlook report for October. “Most demand and adoption measures indicate bitcoin is more likely to stay on its upward path.”

McGlone observed how that a top metric for adoption, the 30-day average of BTC addresses, is equivalent to a price of about $15,000, suggesting that, at current prices of $10,700, the top cryptocurrency is greatly undervalued. He sees the digital asset breaking above $14,000 by end of 2020.

The number of active bitcoin addresses has soared to 981,000, Glassnode data shows, up from 684,000 at the beginning of this year, when the asset’s price averaged around $7,700. When active addresses hit nearly 1.1 million on December 23, 2018, bitcoin traded for $14,800, on the average.

McGlone, a senior commodity strategist at Bloomberg, also pointed to bitcoin’s increasing hashrate, growing institutional investor interest, the coin’s limited supply as well as failing global macroeconomics as potential key drivers for future price growth. He uses the example of the Grayscale Bitcoin Trust (GBTC) as a “direct indicator of investor demand”.

Today, the trust holds the equivalent of about 450,000 BTC. A year ago, it held less than half that amount, indicating rising institutional investor interest. Inflows in GBTC, the largest exchange traded product, absorbed about 70% of new bitcoin supply in third quarter of this year, according to the report.

The report also speculates that the market capitalization of tether (USDT) will surpass that of ethereum (ETH) by 2021, to become the second-largest cryptocurrency in the world. In recent months, tether’s market cap has exploded to $15.6 billion as more investors look to stablecoins to preserve the value of their coins. ETH market cap currently hovers around $39.6 billion.

“Indicating demand for a digital version of gold (bitcoin) and a crypto-asset like the dollar, if current trends prevail, the market cap of tether may surpass ethereum next year,” it said. “Increasing adoption of stable coins is likely a precursor for central bank digital currencies and promises to be more enduring than alt-coin speculative excesses.”

Author: Jeffrey Gogo

Source: News. Bitcoin: Bitcoin To Hit $100,000 in Five Years as Demand and Adoption Increase – Report

Venezuela president Nicolas Maduro says the country is to start using cryptocurrency in both domestic and global trade, as part of efforts to neutralize crippling U.S. economic sanctions.

Speaking in the country’s parliament on Sept. 29, Maduro revealed that the move will “give new strength to the use of petro and other cryptocurrencies, national and global, in domestic and foreign trade…”

The country has already been trying to use its national crypto, the petro, for this purpose but without much success.

Maduro was delivering an anti-sanctions law aimed at spurring economic and social development, both paralyzed by U.S. sanctions. The blockade has also throttled Venezuela’s trade relations with much of the world, where the U.S. dollar still dominates.

Now, the oil-rich South American country has set its sights on virtual currency. Venezuela, the world’s sixth largest oil producer, is hoping to leverage cryptocurrencies to compensate for the squeeze in petrodollars arising from the economic sanctions. Bloomberg quoted Maduro as saying:

The finance minister and Venezuela’s central bank have new instruments which we will activate very soon so that everyone can do banking transactions, as well as national and international payments through the central bank’s accounts. Venezuela is working within the cryptocurrency world.

Excoriated by the West, the leftist Venezuelan leader thundered: “Donald Trump and his sanctions are blocking Venezuela from carrying out transactions in any of the world’s banks. There’s other formulas to pay, and it’s what we’re using, because our payment system works perfectly in China and Russia.”

According to the Bloomberg report, the central bank of Venezuela is formally testing whether it can hold crypto in its reserves. The immediate targets include bitcoin (BTC) and ethereum (ETH).

Both assets have been requested by state-run Petroleos de Venezuela SA. The oil company wants to send BTC and ETH to the central bank and then have it pay the firm’s suppliers with the coins, says the report.

Venezuela’s deepening economic crisis has led to a massive adoption of cryptocurrency, with more than $8 million worth of bitcoin traded peer-to-peer each week, Coindance data shows. The government recently signed a new tax agreement that enabled it to start collecting taxes and fees in the petro.

Author: Jeffrey Gogo

Source: News. Bitcoin: Venezuela To Start Using Cryptocurrency in Global Trade in Efforts To Fend off U.S. Sanctions

Bloomberg cryptocurrency analyst Mike McGlone says bitcoin is greatly undervalued, suggesting that its fair value price should currently be somewhere around $15,000.

The price of bitcoin (BTC) has see-sawed between $10,000 and $12,400 over the last few weeks, often tumbling sharply following what one pundit described as “fake” breakouts.

The latest rout saw BTC crash more than 8% within days from over $11,000 to $10,100. At Press time, each bitcoin is trading for $10,695, up nearly 2% in the last 24 hours.

McGlone, a senior commodity strategist at Bloomberg, based his arguments on various factors, including bitcoin’s rising hashrate, which continues to hit new records, industry media report.

The Bitcoin hashrate continues to increase and recently reached new highs. Also advancing are addresses used. A top metric for adoption, the 30-day average of Bitcoin addresses is equivalent to the price closer to $15,000 when measured on an autoscale basis since 2017.

According to the latest data from charts.Bitcoin.com, BTC’s seven-day average hashrate rose past 140 exahash per second (EH/s) this week, an all time high. On July 28, the figure averaged 127 EH/s, a record at the time.

Hashrate is a measure of the power of the computers linked to the Bitcoin blockchain, which determines their ability to produce new coins. Increasing hash power suggests miners are optimistic about making profits.

This tends to influence the price of BTC higher, given the strong correlation between the two. But the relationship is not exactly as linear, because it is difficult to gauge future price changes based on hashrate alone.

Meanwhile, the number of active bitcoin addresses has soared to 991,000, Glassnode data shows, up from 684,000 at the beginning of this year, when the asset’s price averaged around $7,700. When active addresses hit nearly 1.1 million on December 23, 2018, bitcoin traded for $14,800, on the average.

McGlone has remained upbeat about bitcoin throughout its volatile swings, at a point suggesting this is to be the year that the top crypto will become a digital version of gold, a prime store of value.

In his new analysis, he admits there might be pitfalls curtailing BTC’s price growth going forward – and that would have to be a reversal of the on-chain metrics related to “the hashrate and active addresses.”

Author: Jeffrey Gogo

Source: News. Bitcoin: Bitcoin Is Undervalued, Fair Value Price Should Be $15,000, Says Analyst

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